advertisement

Square, one of the biggest Point of Sale companies, announced November 15 that it was testing its support for bitcoin through its cash payments app. According to one Credit Suisse analyst, the move to adopt the cryptocurrency could net the firm $30 million over the next couple of years.

Soon after the announcement, on November 20, the company’s shares rose three percent which could be a display of strong confidence on the part of investors’ in bitcoin.

Sarah Friar, Square CFO, told CNBC in a recent interview that the company was experimenting with bitcoin. It seems that the company believes that a lot of its customers would be in favor of adding bitcoin as a payment option onto the Square platform. According to Friar, the customers were asking for a tool that would allow them to buy and sell bitcoin easily.

“I don’t think we know yet what it is going to be, but I think it absolutely as an innovator, Square has to be there to let our customers do what they want to do.”

After the report, Credit Suisse immediately predicted that the company would be able to generate $30 million in annual sales from bitcoin in around two years. Square can add tens of millions of dollars of annual revenue by supporting bitcoin and Credit Suisse has raised its price target for Square shares because of its experience in the industry and the new opportunity in the digital currency market.

Credit Suisse analyst Paul Condra stated:

Advertisement

advertisement

“We estimate that if Square can accumulate 10 million bitcoin buyers over two years (tracking Coinbase’s growth), this could drive an incremental $30 million in revenue. While we are positive on Square’s strategy, to the extent it confers legitimacy on Bitcoin and prompts adoption by other providers (i.e., PayPal) the biggest beneficiary may be the crypto-asset industry.”

The analyst stated his neutral rating and increased his price target to $37 from $31 for Square shares, representing 16 percent downside to last week’s close. The price has since exceeded this target, trading above $45 on November 20.

Paul Condra stressed the company might charge a fee of 1.5 percent per transaction and the average customer could spend about $200 a year in bitcoin purchases, according to his estimates.

Square is an easy-to-use credit card processing platform and the one of the most used feature-rich free Point of Sale (POS) system on the market today. Unlike many other POS systems, Square does not charge any monthly fees. Square can be used to complete credit card transactions in any brick and mortar store, as well as online and on the go via a mobile device.

Square charges a flat rate price per credit card transaction, regardless of the type of card you are processing, the customer’s bank fee, the credit card company fee, and the merchant account processor fee are all wrapped up into one flat rate fee. The advantage of this is its simplicity. Users don’t have to worry about figuring out how much they are paying in credit card processing fees, because they know in advance exactly how much they’re going to pay. It’s the same flat rate no matter what type of card a customer uses.

This move from Square, may turn out to be excellent news for the community as it is one of the most well-known Point of Sale companies adding the digital currency to its payment methods. Square might be the first big Point of Sale company introducing bitcoin, but it is fair to say that many other companies may follow its footsteps .

DISCLAIMER: BTCManager.com is not a financial project and does not provide any investment services or represent anyone's interests other than its own. For basic information on this website we put our own knowledge about online payment methods, practical skills and years of experience. BTCManager website is offered to wide range of readers as a daily digest that focuses on issues and modern solutions in the practical application the main cryptocurrency and its derivatives. Among our main objectives is to popularize the use of cryptocurrency, explanation what cryptocurrencies are and how they play the role of payment instrument and means for safe storing and earnings, as well as providing the necessary knowledge, educational articles, information about upcoming events and conferences dedicated to the development of cryptocurrency. BTC Manager is not responsible for any results of your using the information from our website. BTCManager.com is not responsible for the content of external sites.